Case Law Details
UP VAT Act Act does not contemplate that if claim of Input Tax Credit (I.T.C.) is reversed the registration of a dealer could be cancelled in addition to reversal of I.T.C. By virtue of proviso to Section 14 of the UP VAT Act, the assessee would only be liable to pay interest at a rate of 15% per annum.
Raising of an incorrect claim of I.T.C. is not one of the grounds contemplated under Section 17 (11) for cancellation of registration. Sub-Clause 9 which is pressed into service, enables the authorities to cancel registration for any other ‘sufficient cause’. The term ‘sufficient cause’ is a word of significance and has to be construed as being of same genus, as occurring in clause (i) to (viii) of Section 17 (11), following the principles of ejusdem generis”, the Judge also observed.
Mere wrongful claim of I.T.C. would not be a sufficient cause to cancel the registration of dealer. Cancellation of dealer’s registration is a drastic step, which can be taken only for justifiable causes, as are permissible in law and not otherwise”, the Court also added.
FULL TEXT OF HIGH COURT JUDGMENT
Registration as dealer of assessee has been cancelled by the authorities invoking jurisdiction under Section 17 (11) (ix) of the U.P. Value Added Tax Act, for the reason that the assessee had wrongly claimed benefit of I.T.C., showing purchase of goods from M/s Shree Krishna Builders & Developers, Chandpur, Bijnor, whereas no such sale was made by the concerned developer. The benefit of I.T.C. was reversed and thereafter notice was issued for cancellation of registration certificate. After affording an opportunity of hearing, registration certificate has been cancelled and affirmed by the Tribunal. Thus aggrieved, the dealer is before this Court.
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